Question 1

The statement of retained earnings reconciles the beginning retained earnings balance to the retained earnings balance at the end of the current period.

Accepted Answer

A) True 
 B)False

Question 2

It is generally recognized that the market is more efficient when dealing with small firms that are not trading on large organized stock markets.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a permanent account?

Accepted Answer

A)  Dividends
B)  Advertising expense
C)  Building
D)  Selling expense
E)  Insurance expenseF) C) and E)
G) All of the above

Question 4

For consolidating, the FASB recognizes risks, rewards, decision-making ability and the primary beneficiary.

Accepted Answer

A) True 
 B)False

Question 5

Not all reports to the SEC are made available on EDGAR.

Accepted Answer

A) True 
 B)False

Question 6

Accepted accounting principles leave ample room for arriving at different results in the short run.

Accepted Answer

A) True 
 B)False

Question 7

Tiffin Company had retained earnings of $50,000 at the end of last year.For the current year, income was $20,000 and dividends $15,000.What is the balance in retained earnings at the end of the current year?

Accepted Answer

A)  $85,000
B)  $45,000
C)  $55,000
D)  $60,000
E)  none of the answers are correctF) C) and E)
G) All of the above

Question 8

Which of the following is not a true statement relating to the Treadway Commission?

Accepted Answer

A)  The Treadway Commission is the popular name for the National Commission on Fraudulent Reporting.
B)  The Treadway Commission has released reports detailing internal control systems.
C)  Management's Report on Internal Control over Financial Reporting and the independent public accounting from report to the shareholders and board of directors often refer to criteria established on internal control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) .
D)  The Treadway Commission has issued a number of recommendations for the prevention of fraud on financial reports, ethics, and effective internal controls.
E)  The Treadway Commission is a voluntary-sector organization formed to support the Sarbones-Oxley Act.F) A) and E)
G) A) and D)

Question 9

The income statement is a summary of revenues and expenses and gains and losses, ending with net income, for a particular period of time.

Accepted Answer

A) True 
 B)False

Question 10

The sequence of accounting procedures completed during each accounting period is called the accounting cycle.

Accepted Answer

A) True 
 B)False

Question 11

In terms of debits and credits, which of the following accounts have the same normal balances?

Accepted Answer

A)  Accounts payable, accounts receivable, notes payable
B)  Dividends, accounts receivable, notes payable
C)  Advertising expense, selling expense, accounts receivable
D)  Land, building, accounts payable
E)  Common stock, notes payable, landF) A) and B)
G) All of the above

Exam 2: Introduction to Financial Statements and Other Financial Reporting Topics

The sequence of accounting procedures completed during each accounting period is called the accounting cycle.

Correct Answer
verified

It is generally recognized that the market is more efficient when dealing with small firms that are not trading on large organized stock markets.

Correct Answer
verified

The statement of retained earnings reconciles the beginning retained earnings balance to the retained earnings balance at the end of the current period.

Correct Answer
verified

The income statement is a summary of revenues and expenses and gains and losses, ending with net income, for a particular period of time.

Correct Answer
verified

Accepted accounting principles leave ample room for arriving at different results in the short run.

Correct Answer
verified

Which of the following is not a true statement relating to the Treadway Commission?

Correct Answer
verified

Not all reports to the SEC are made available on EDGAR.

Correct Answer
verified

In terms of debits and credits, which of the following accounts have the same normal balances?

Correct Answer
verified

For consolidating, the FASB recognizes risks, rewards, decision-making ability and the primary beneficiary.

Correct Answer
verified

Which of the following is a permanent account?

Correct Answer
verified

Tiffin Company had retained earnings of $50,000 at the end of last year.For the current year, income was $20,000 and dividends $15,000.What is the balance in retained earnings at the end of the current year?

Correct Answer
verified

Exam 2: Introduction to Financial Statements and Other Financial Reporting Topics

The sequence of accounting procedures completed during each accounting period is called the accounting cycle.

Correct AnswerverifiedShow Answer

It is generally recognized that the market is more efficient when dealing with small firms that are not trading on large organized stock markets.

Correct AnswerverifiedShow Answer

The statement of retained earnings reconciles the beginning retained earnings balance to the retained earnings balance at the end of the current period.

Correct AnswerverifiedShow Answer

The income statement is a summary of revenues and expenses and gains and losses, ending with net income, for a particular period of time.

Correct AnswerverifiedShow Answer

Accepted accounting principles leave ample room for arriving at different results in the short run.

Correct AnswerverifiedShow Answer

Which of the following is not a true statement relating to the Treadway Commission?

Correct AnswerverifiedShow Answer

Not all reports to the SEC are made available on EDGAR.

Correct AnswerverifiedShow Answer

In terms of debits and credits, which of the following accounts have the same normal balances?

Correct AnswerverifiedShow Answer

For consolidating, the FASB recognizes risks, rewards, decision-making ability and the primary beneficiary.

Correct AnswerverifiedShow Answer

Which of the following is a permanent account?

Correct AnswerverifiedShow Answer

Tiffin Company had retained earnings of $50,000 at the end of last year.For the current year, income was $20,000 and dividends $15,000.What is the balance in retained earnings at the end of the current year?

Correct AnswerverifiedShow Answer

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